corporate report OVERVIEW
Building a global success NTP is a key international player in the nuclear technology business — with a market footprint in 50 countries ý SA has been producing medical radioisotopes — the active pharmaceutical ingredients used in nuclear medicine for diagnostic imaging and therapy — for over 40 years. It’s only in the past two decades, however, that a little-known stateowned company, NTP Radioisotopes SOC, has emerged as a key international player in the nuclear technology business — with a market footprint that covers 50 countries and an annual turnover of more than R1.2bn. This is remarkable, as NTP, a subsidiary of the SA Nuclear Energy Corporation (Necsa), was posting a R10m annual loss just a few decades ago. Nuclear medicine is a minimally invasive practice that uses minute amounts of radioactive isotopes (also called radioisotopes) primarily for medical imaging to view the structure and function of organs, bone, tissue or systems in the human body. Unlike X-rays and other radiological imaging, nuclear medicine allows doctors to observe the bodily functions right down to a molecular level. As a result, imaging obtained from nuclear medicine often allows a disease to be identified at a much earlier stage, before anatomical changes become visible. This allows physicians to target and treat certain conditions using medical radioisotopes. Globally, the most important medical radioisotope is molybdenum-99 or Mo-99. The daughter 2
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product of Mo-99 is technetium99m (Tc-99m), which is used in over 40m nuclear medicine procedures each year. There are only four sites globally that are capable of producing commercial volumes of Mo-99, one of them being NTP Radioisotopes based in Pelindaba, just outside Pretoria. Mo-99 is produced through a process of nuclear fission inside a nuclear reactor — in this case, the SAFARI-1 research reactor at Pelindaba. Mo-99 has a half-life of just 66 hours, which means it can’t be stockpiled and has to be constantly manufactured in fresh batches. Tc-99m has a half-life of just six hours, making it safe for medical use. The latter emits low-energy gamma rays that are ideally suited for imaging using gamma cameras such as those in single-photon emission computed tomography (SPECT) imaging. In addition to producing Mo-99 and Tc-99m, NTP manufactures two other reactor-based medical radioisotopes: iodine-131 and lutetium-177 n.c.a, both of which have diagnostic and therapeutic applications. The company also produces non-reactor-based medical radioisotopes in its onsite cyclotron. Export sales account for about What it means: In the past two decades NTP has emerged as a key international player in the nuclear technology business
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Tina Eboka: The group is targeting a turnover of R2bn by the 2020/2021 financial year
90% of NTP’s revenue, and the company’s clients include global leaders in nuclear medicine imaging and diagnostics such as Lantheus Medical Imaging, GE Healthcare, Curium, Nihon Medi-Physics, Jubilant DraxImage, HTA Co, Samyoung Unitech and the Eczaibasi-Monrol group. The company’s biggest market is North America (30%), followed by the Far East (22%), Europe (15%) and South America (5%). The rest of the world, including SA, accounts for the balance of its market. NTP has also established or acquired a number of wholly or partially owned subsidiary companies as the company's footprint has grown. AEC-Amersham is a wholly owned subsidiary which markets NTP radiopharmaceuticals, healthcare and life science products in the African and Indian Ocean region, while NTP Logistics, a 51% owned company, specialises in the global distribution of hazardous and time-sensitive goods and provides logistics services to NTP as well as other industrial and corporate clients.
NTP as a group has had sustained growth in the past decade, passing the R1bn revenue mark in the 2014/2015 financial year and posting sales of over R1.2bn in 2015/2016. According to group MD Tina Eboka, NTP is targeting a turnover of R2bn by the 2020/2021 financial year. NTP is also financially selfsufficient. “We receive no government funding, our only source of income is the sales we generate,” says Precious Hawadi, NTP group executive for finance. Growth will come from the expansion of the company’s commercial operations in Africa as well as diversifying its product offering. “Given that 90% of our revenue comes from global sales while only 10% is derived locally, our 2020/2021 target is achievable if we grow demand for nuclear medicine locally and grow our commercial operations in Africa. For this to happen it is imperative that we become more visible,” says Hawadi. The company has grown its market share for Mo-99 through continued investment in produc-
ntp radioisotopes tion and by working with partner organisations to cover the supply gap following the exit of a leading Canadian supplier from the nuclear medicine market, says Eboka. “NTP successfully provides the foundational material for a global, multibillion dollar nuclear medicine industry,” says Eboka. “Our growth is a result of the fact that we excel at manufacturing, processing and moving the extremely time-sensitive radiochemicals to customers around the world and we have acquired a
good reputation for reliability and consistency.” NTP is one of only a few vertically integrated medical radioisotope manufacturers in the world, and acts as both a primary producer and beneficiator of its products. In addition, its advanced manufacturing capabilities and pioneering technology have been exported to other countries. SA’s proprietary process for the use of lowenriched uranium (LEU) in the production of Mo-99 has been licensed to the Australian Nuclear
Science & Technology Organisation which is one of NTP’s key partners. However, Eboka says growth is potentially constrained by NTP’s current reliance on just one product, Mo-99, as well as restrictions on production. “Added to this,” she says, “we’re cognisant of the fact that increased revenues must not come at the expense of existing customers, who demand a reliable and consistent supply of high-quality radioisotopes.” x
ority for what was then the Atomic Energy Corporation, later Necsa. In 1991 SA became the first country to voluntarily dismantle its nuclear armaments programme, when it signed the Nuclear NonProliferation Treaty. At the same time, nuclear medicine was becoming a growing area in the medical field. The decision was made to convert part of the facility at Pelindaba to produce radioisotopes and pursue the radiopharmaceutical industry more proactively. Technology that had once pro-
duced enriched uranium for military uses was now used to produce life-saving radioisotopes that could be used in nuclear medicine. In 2003 NTP Radioisotopes was registered as a wholly owned subsidiary of Necsa and began pioneering nuclear medicine products for use in the diagnosis of conditions including cancer, cardiovascular disease and neuroendocrine illnesses. In 2009 the SAFARI-1 reactor core was converted from weapons-grade highly enriched uranium (HEU) to non-weaponsgrade low-enriched uranium (LEU)
Precious Hawadi: Expansion into Africa is one of the group’s growth strategies
OPERATIONS
Harnessing SA’s nuclear expertise NTP has proven the incredible potential of peaceful applications of nuclear technology ý A company with a proudly SA heritage, NTP’s origins lie in the establishment of SA’s nuclear armaments programme under the apartheid government. The SAFARI-1 research reactor became operational in 1965, when the country’s first self-sustaining chain reaction took place in March of that year. By 1973, SAFARI-1 was already producing small quantities of medical radioisotopes, almost as a by-product of its normal research activity. During that same period, however, the country’s larger nuclear programme started to take a different direction as the apartheid government embarked on a local uranium enrichment programme that would eventually be used to prepare six nuclear warheads. It was not until the early 1990s that the peaceful applications of nuclear technology became a pri-
fuel and a year later the first largescale commercial Food and Drug Administration-approved batch of all-LEU Mo-99 was produced and shipped to the US for patient use. NTP remains the world leader in the implementation and production of all-LEU products. NTP pioneered the production and therapeutic use of beta-emitter lutetium-177 n.c.a (Lu-177) in SA in 2012, under licence from ITG in Germany. Lu-177 n.c.a. is considered one of the most promising new therapies for prostate cancers. NTP has established a Lu-177 plant, which will soon provide a local source of the radioisotope. “SA should be proud of what nuclear scientists in this country have achieved in the past half a century,” says NTP group MD Tina Eboka. “We’ve managed to turn the purpose of the reactor into a force for good and ensured that the nuclear medical products we produce perform a vital role in healthcare globally and enhance people’s lives. Our vision is to make medical radioisotopes more accessible to more people, particularly in Africa.” In addition, NTP has become a repository for nuclear and nuclear pharmaceutical expertise, and is a significant earner of foreign exchange. x The SAFARI-1 research reactor in the early 1970s, shortly after it began operating
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corporate report ntp radioisotopes MARKET SHARE
A global nuclear powerhouse The group meets up to a third of the world’s demand for key medical radioisotope Mo-99 and is the third-largest supplier of bulk iodine-131 ý NTP Radioisotopes is one of the three largest global producers of key medical radioisotope Mo-99. The company has recently increased its global market share after the exit of a large Canadian producer in late 2016. The global nuclear medicine and radiopharmaceutical market was valued at around US$11bn in 2016 and is projected to grow to more than $20bn by 2021. Within sub-Saharan Africa, SA has the largest number of nuclear medicine practitioners and nuclear medicine centres, including nuclear medicine departments at 12 state hospitals. “Imaging obtained from nuclear medicine often allows a disease to be identified at a much earlier stage, before anatomical changes become visible,” says Dr Nozipho Nyakale. Nyakale is head of nuclear medicine at Durban’s Inkosi Albert Luthuli Central Hospital and also serves on the NTP group board. “Because of the specialised imaging that nuclear medicine makes possible, it can pick up certain diseases much earlier, which could mean patients would be able to start treatment earlier, which could save a lot of money — not to mention improving the patient’s quality of life and their prognosis.” Globally, demand for nuclear medicine products and medical
radioisotopes has shown healthy growth over the past decade, which has been driven by increases in the incidence of cancers and cardiovascular disease, as well as new applications for medical radioisotopes including the study of neurological and psychiatric diseases. NTP’s market research officer Thuli Lethule says locally there is still a lack of awareness of the benefits of nuclear medicine. “We try to have a presence at relevant medical conferences, but ultimately we need to ensure that there is greater education aimed at GPs, oncologists and patients around the benefits of nuclear medicine,” says Lethule. Another impediment to the more widespread use of nuclear medicine, says Lethule, is the high cost and accessibility to nuclear medicine facilities. NTP is the sole manufacturer and supplier of Mo-99 and Tc-99m in SA, meaning the company is
Dr Nozipho Nyakale, left, head of nuclear medicine at Durban’s Inkosi Albert Luthuli Central Hospital, and NTP’s market research officer Thuli Lethule, right, who promotes awareness of the benefits of nuclear medicine on the African continent
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fundamental to nuclear medicine in private and public practice. NTP plays a similarly key role in the global market. NTP maintains good relationships with partners at the Australian Nuclear Science & Technology Organisation (Ansto) and IRE (Belgium), to ensure security of supply of medical radioisotopes. In 2016 NTP group MD Tina Eboka was elected vice-president of the Organisation for Economic Co-operation & Development High-Level Group on the Security of Supply of Medical Radioisotopes — a group set up following a global shortage of Mo-99 in 2009 and 2010. NTP was the first major isotope producer appointed to the group’s executive, and Eboka was re-elected to the position in July 2017. NTP, together with its partners, now supplies up to a third of the world’s key medical radioisotope Mo-99. It is also the third-largest supplier of bulk iodine-131. x
REGULATION
Focus on compliance NTP is fully compliant with around 50 different regulatory licences that cover nuclear facilities and radiopharmaceuticals
ý Nuclear and radiation facilities globally operate under stringent regulatory conditions. According to NTP group MD Tina Eboka, regulatory compliance requirements for nuclear facilities as well as radiopharmaceutical products continue to increase nationally and globally. “NTP is fully compliant with around 50 different regulatory licences relevant to the production and distribution chain of radiopharmaceuticals,” says Eboka, adding that through forward-thinking initiatives NTP is well positioned to anticipate regulatory changes and address these before they can negatively affect the business. During 2016 NTP successfully completed its ISO 9001 transition audit and received ISO 9001:2015 certification in early 2017. It is the responsibility of Omphile Modibela, head of legal & technology management at NTP, to understand the complex environment in which NTP operates, from a compliance and regulatory perspective. Her role is to understand all the applicable legislation relevant to each market in which NTP operates and to ensure that NTP minimises any risk to the business related to contractual obligations.
EXPERTISE
Transfer of critical skills Succession plans are put in place to ensure nurturing of talent and skills transfer
Omphile Modibela: Radiopharmaceuticals are regulated more stringently than regular pharmaceuticals
Modibela, a patent attorney and chemical engineer, has a keen understanding of local and international regulatory requirements pertaining to nuclear products. “We’re regulated from both a nuclear safety perspective as well as a health perspective, given that we essentially produce pharmaceutical products,” she says. “However, we are regulated much more stringently than a regular pharmaceutical company, and we also have to comply with all the necessary regulations pertaining to a state-owned enterprise.” NTP invests significantly in maintenance, which has led to production efficiencies and significantly improved volumes in the past year. As a result SAFARI-1 — a vital component of NTP production activities — is one of the most commercially utilised research reactors in the world, and is in operation for more than 300 days a year despite having celebrated its 50th birthday in 2015. NTP continues to invest in its infrastructure in order to ensure continued compliance. x
ý By their very nature, nuclear reactors and radiopharmaceutical products require specialised expertise. NTP Radioisotopes is home to one of the most productive and advanced radioisotope manufacturing facilities in the world, and boasts a highly skilled workforce — now numbering over 440 employees, from just 30 people in 1992. “The local skills and expertise used to operate SAFARI-1 — together with the development, production and distribution of radioisotopes — needs to be preserved and passed on to future generations,” says NTP’s head of talent and transformation Benedicta Sepora. “Until very recently our knowledge base was dependent on a handful of key individuals — many of them close to retirement age — which presented a business continuity risk for the group. We have put succession plans in place and developed a talent pipeline for all key positions, ensuring that senior specialists mentor incoming talent.”
Benedicta Sepora: NTP is committed to skills transfer and equity by growing the number of women in senior positions
NTP has also launched a bursary scheme, which offers opportunities for deserving students to gain access to education in related science fields. The scheme supports two pharmacy degrees and one chemical engineering degree and will be expanded next year to further meet the company’s talent pipeline requirements. A year-long internship programme focused on nuclear science, chemical and engineering
degrees has also proved a significant success and is helping the company build its talent pool. “Our ultimate goal is to create a sustainable supply of key skills to meet both current and future production needs,” Sepora says. At the same time, the company is carefully and deliberately growing and supporting the number of women it has in senior positions, and at board level. Both its chair and MD are women — as is half of the group’s board. x
NTP is investing in building a talent pipeline, from technicians and pharmacists to engineers and doctors
AFRICA Meeting Africa’s need for nuclear medicine Developing and accelerating its business in Africa is a key priority for NTP, both in terms of the company’s growth strategy and to meet a growing demand for nuclear medicine and medical radioisotopes on the continent. According to group MD Tina Eboka, NTP’s primary focus in Africa will be on three regions: Southern, Eastern and Western Africa. “Our intention is to work with in-country nuclear medicine centres and physicians to make nuclear medicine technologies and products more accessible to more African patients,” she says.
There are around 17 nuclear medicine centres in sub-Saharan Africa — excluding SA — serving a population of over 377m people. NTP is partnering with local organisations and medical practitioners as it identifies each region’s particular requirements. “Together with one of NTP’s subsidiary companies, AEC-Amersham, we are able to offer African nuclear medicine centres and practitioners a unique value proposition,” says Eboka. “We also manage the on-time delivery of time-critical radiopharmaceuticals, anywhere on the continent, through NTP Logistics.” Thursday September 14 2017
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corporate report ntp radioisotopes LOCAL GROWTH
Building local life sciences The group’s subsidiary helps its operation in an industry where time is a critical factor
Mapula Letsoalo: Scientific expertise central to production
ý AEC-Amersham, a wholly owned subsidiary of NTP Radioisotopes, is the largest supplier of radiopharmaceuticals in SA. It specialises in the distribu-
tion, marketing and sales of radiopharmaceutical products as well as a range of health-care, life sciences and quality and safety products. Working with NTP, more than 80% of AEC-Amersham’s radiopharmaceutical products are made locally — the company only imports around 15% of requirements. This is essential in an industry where time is a critical factor, and ingredients cannot be stockpiled. Despite often testing local con-
ditions, AEC-Amersham has continued to post slow and steady growth in revenue, contributing R136m in sales to the group’s income in 2016/2017. Creating further challenges is the fact that European and Asian markets are saturated, with the result that many radiopharmaceutical companies from these regions are also looking at African markets as territories with growth potential. AEC-Amersham MD Mapula Letsoalo, a pharmacist, got into the
LOGISTICS
Specialised transport for sensitive products To ensure safe and reliable transport of its products, NTP has invested in its own highly specialised logistics service
ý Unlike regular pharmaceutical products, radiopharmaceutical products are extremely time-sensitive. This naturally affects logistics, which is handled by NTP Logistics, a 51% controlled entity. Operating both locally and internationally, NTP Logistics provides an end-toend logistics chain that ensures NTP is able to deliver its products timeously. “We specialise in high-value, time-sensitive and hazardous packages,” says NTP Logistics MD Ntokozo Mogorosi. There is specific legislation and regulation around how radiation 6
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products are transported locally and internationally. “The International Atomic Energy Association oversees all players in the nuclear space, regulating their activities as well as the transportation of radiation technology products such as those produced by NTP,” she says. “This includes specific packaging to ensure that nobody is exposed to hazardous radiation as well as limiting how much radiation can be transported in a shipment at any one time.” Prior to the establishment of NTP Logistics, NTP struggled to appoint a logistics company capa-
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ble of adhering to these specific regulations and that was mindful of the time-sensitive nature of the products they were transporting, says Mogorosi. Without timely delivery, doctors would also not be able to perform scheduled imaging or treatment sessions. NTP Logistics delivers NTP products to 50 countries each day. “We have a global network of over 6,000 partners in 789 cities throughout the world, making time-sensitive deliveries,” she says. x Ntokozo Mogorosi: Focus on high standards of safety
industry almost by accident. “I was working in the patient dispensary at Ikalafeng Hospital when a call came from a recruitment company looking for a pharmacist at Pelindaba. She went on to head up radiochemical and then radiopharmaceutical production before taking up her role at AEC-Amersham in 2015. “There are numerous factors that contribute towards a successful production run, all of which require significant scientific expertise. No two days are ever the same and there is always something new to learn.” x
GOVERNANCE
RESEARCH
A formidable team of women
Key global partners
A high-profile team is echoed in the growing number of women across the company
Investment in early-stage research helps build NTP’s pipeline of new technologies
ý There is little doubt that NTP operates in a class of its own. As a wholly owned subsidiary of Necsa, and as such a state-owned enterprise, the company is well-run, self-sustaining and profitable — as can easily be seen in the group’s results published as part of Necsa’s annual reports. One of the reasons for its success is the fact that world-class governance is non-negotiable at NTP. “We operate in a high-profile, high-risk space and we are very diligent about every part of our operation, from how we produce to how we procure,” says Precious Hawadi, NTP group executive for finance. “We have an active audit and risk committee in place and we are careful about who we deal with and we ensure there is no conflict of interest.” Hawadi adds that NTP’s processes are designed to pick up on any undesirable behaviour. In addition, a fraud hotline is in place to further ensure that nothing untoward takes place. Governance at NTP is helped by the fact that the company has strategically focused board members who don’t compromise on any standards, says group MD Tina Eboka. “Our board understands the legislative and risk issues we are faced with and has an uncompromising attitude towards governance and delivery,” she says. These principles of good corporate governance are woven into the culture of NTP, says board chair, Dr Namane Magau. “Operating as it does in a highly regulated industry, an adherence to good governance is essential.” NTP’s success is also due, in no
ý Research and development of new radiopharmaceutical products in SA resides with NTP Radioisotopes’ parent company, the SA Nuclear Energy Corporation (Necsa). Necsa is responsible for bringing new products and technologies to market, says NTP head of legal and technology management Omphile Modibela. However, NTP is launching a new function inhouse to focus on innovation and how to launch new products into the market. “In order to achieve our growth strategy it’s important that we have a better understanding of what it takes to successfully commercialise nuclear technologies,” she says. “The peculiarity of commercialising nuclear technology is that you can invest in 10 ideas but only one may succeed. “We have realised that we need to invest in early stage research in order to build our pipeline of new technologies.” Ongoing research into radiopharmaceuticals is essential to NTP’s continued position as SA’s primary supplier of radiopharmaceutical products for nuclear medicine. NTP has entered into partnerships with a number of leading academic hospitals including Charlotte Maxeke and Tygerberg Hospitals and research institutions such as the University of Stellenbosch and the SA National Research Foundation’s iThemba Labs. NTP also provides subsidised radiopharmaceuticals for use in clinical trials of isotope-based diagnostic and treatment procedures. x
An aggressive empowerment agenda has led to a number of highly capable women with expertise in various positions in the organisation.
Board chair, Dr Namane Magau, and Tina Eboka, group MD at NTP Radioisotopes
small part, to the calibre of its leadership — which now includes a large proportion of women. This, says Dr Magau, is about more than merely complying and includes a powerful human element. “Credit must be given to group MD Tina (Eboka) in this regard,” she says. “She has brought significant business experience and established strong relationships with the company’s senior executives. All too often scientists focus only on the science, with the result that the business suffers.” Since joining NTP in 2014, Eboka has pushed an empowerment agenda and appointed a number of highly capable women into the organisation. “Female leadership brings a different perspective to an organisation,” says Omphile Modibela, head of legal and technology management at NTP, quoting a 2015 McKinsey study which found that advancing women’s equality in the workplace has the potential to add US$12 trillion to global GDP by
2025. Eboka, who studied industrial and textile engineering and applied mathematics, and who has an MBA, has little appetite for what she calls “grandiose popularity” or seeing her name in lights for the wrong reasons. What she’s more interested in is growing the business ethically and responsibly. Leadership is about strategy and implementation. It’s not only about having a high IQ, but empathising and systemising quotient as well. Throughout her 25-year career transformational change management has been her particular focus, and under her leadership NTP has focused on employing more women. A number of women are now in the group’s senior management positions. The result of Eboka’s expertise is an organisation which is wellrun and managed, which has created an enabling environment for young scientists and is an important scientific asset for SA. x
Corporate Report compiled by Lynette Dicey Advertising executive: Debbie Montanari
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